Hedge funds and VCs spar over the future of tokenized assets (TWIF 12/12)

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Today's headline pertains to a fun fight between Citadel and a16z, who are sparring in comments over the role of defi in financial markets – read on below.

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Lastly, some good food for thought this week on financial nihilism, slot machine product development, and where we are in the consumer investing landscape:

Please enjoy another week of fintech and banking news below.

Have feedback for us? Let us know. Find me at @nikmilanovic, @twifintech, and @ndm

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The CFTC launched a Digital Assets Pilot Program that authorised certain digital assets as collateral in regulated derivatives markets and issued related guidance to support tokenised collateral within a modernised regulatory framework.

The Financial Conduct Authority launched the “Firm Checker” software tool to help consumers verify whether a firm was authorised and thereby reduce the risk of falling victim to financial scams.

Visa and Mastercard are moving quickly into stablecoins and crypto payment initiatives to expand their payments ecosystems and capture growing demand for digital dollar-linked assets.

Ripple hedged a $500 million institutional investment round with protections for investors that drew major Wall Street backers like Citadel Securities and Fortress Investment Group at a roughly $40 billion valuation.

BMW used JPMorgan’s Kinexys blockchain platform to automate its euro-to-dollar foreign exchange transfers, reducing manual intervention and treasury buffers

Cross River expanded its card program offerings by launching an in-house card processing engine that gave partners full control over issuing and processing.

Citadel Securities and Andreessen Horowitz sparked debate over the future of tokenized stocks and decentralized trading as Citadel signalled caution about DeFi platforms gaining market share.

Senator Elizabeth Warren demanded federal regulators conduct a private-credit stress test after a series of bankruptcies raised concerns about systemic risks in the credit market.

Stripe launched its new Agentic Commerce Suite to help merchants make their products discoverable to AI agents, simplify agent-driven checkouts, and accept agentic payments through a single integration. Stripe and Paradigm also opened the Tempo blockchain to the public in a trial that invited companies to build real-world stablecoin payment applications, adding partners including Kalshi and UBS.

Mercury* launched its Mercury Personal consumer banking product to all U.S. residents, marking an expansion from business‑focused fintech services into the broader retail banking market with high‑yield features and premium tools for managing money.

SoFi Technologies introduced the SoFi Smart Card, an all-in-one financial account that combines savings, checking, debit, and credit benefits with high rewards and cash-back features for eligible new SoFi Plus members.

Finextra launched a market intelligence app to give financial professionals free access to AI-driven data, watchlists, insights, and market context across banks, fintechs, and listed companies.

AMGI Studios, ClickZero, and PayOS teamed up to debut Agentic Character Commerce, a new solution that enabled merchants to engage customers through animated AI agents integrated with commerce and secure payment rails.

Armundia Group launched its platform to streamline alternative investment fund operations with integrated tools for data, compliance, and administration.

Tala partnered with Huma Finance to launch a tokenized lending platform on Solana using USDC liquidity and AI-underwritten credit to expand permissionless access to loans for underbanked consumers globally.

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The industry that invented cautious is now the unexpected champion of the tech race: The latest Postman State of the API Report shows 56% of financial firms are building for AI agents, outpacing other sectors by 17 points, while 34% are actively turning their APIs into pure revenue. Discover the strategic roadmap behind this aggressive embrace of AI and API commercialization: Read the full report here.

Learn more

Want to sponsor a newsletter? See our sponsorship information here.

Brex announced a multi-year partnership with Fifth Third Bank to power a new AI-powered commercial card solution for the bank’s clients that they estimate will represent $5.6 billion in annual payment volume.

Robinhood Markets entered the Indonesian market by agreeing to acquire local brokerage Buana Capital Sekuritas and licensed crypto trader Pedagang Aset Kripto, establishing its first foothold in Southeast Asia.

Coinstar picked Lithic to power its new CINQ by Coinstar Debit Card that converted physical cash into digital currency accessible via virtual and physical cards.

"Today, one in four companies now pay employees in stablecoins, an adoption rate that’s tripled between 2023 and 2024." – Eddie Harrison, Co-Founder and Chief Growth Officer, Navro